Connecticut-based Panolam Industries International, parent to Auburn's Pioneer Plastics, a manufacturer of laminates, has filed voluntary Chapter 11 bankruptcy in a restructuring agreement that allows it to shed about 44% of its debt, or $151 million.

The agreement is expected to be approved by the U.S. Bankruptcy Court in Delaware before the end of the year, according to a company release, and operations are expected to continue as normal. Panolam, which bought Pioneer Plastics in 1999, posted $121 million in net losses in 2008 and $17.4 million in losses for the first half of 2009, according to filings with the Securities and Exchange Commission. Citing the downturn in the housing industry, Pioneer Plastics laid off 48 employees -- about 16% of its local work force -- at the Auburn plant in December, reported the Sun Journal.

If approved, the agreement would allow the company to eliminate $16 million in annual cash interest payments, according to the release. Apollo Capital Management and Eaton Vance Management hold the majority of the company's debt.